Consumer forum imposes Rs 1.2 lakh cost on Nagpur real estate firm

The complainant, through counsel Kamal Satuja, moved the forum after Phoenix Infra didn’t commence construction of the flat scheme for over four years even after accepting Rs8.12 lakh down paymentTNN | August 01, 2017, 15:00 IST

NAGPUR: Coming down heavily on the builder and real estate firm Phoenix Infra International Limited, the State Consumer Disputes Redressal Commission slapped Rs 1.20 lakh cost on its directors for physical and mental harassment, and or failure to provide flat as per agreement.

The directors — Ahemd Jiwani, Jitesh Nashine and Gautam Vijay — were also told to execute sale deed of its multi-storied building ‘Golden Castle’ and hand over the flat’s possession as per the memorandum of understanding (MOU), to complainant Ravi Pritmani. In case of failure, they would refund Rs 8.12 lakh taken as down payment with 18% interest from August 15, 2012, and additional Rs 2 lakh for losses caused to him.

The complainant, through counsel Kamal Satuja, moved the forum after Phoenix Infra didn’t commence construction of the flat scheme for over four years even after accepting Rs8.12 lakh down payment. As per the pact between them, the firm was to give the flat’s possession within 36 months from August 15, 2012, but till date no progress was made.

“We found that the opposite party (Phoenix Infra and directors) rendered deficient services to the complainant and adopted unfair trade practices by not commencing work and completing construction even after the agreement,” a division bench comprising presiding member BA Shaikh and member SB Sawarkar held while partly allowing the complaint.

The real estate firm launched its flat scheme in 2012 and entered into an MOU with the complainant on October 25 the same year for the purchase of flat. It was paid Rs 8.12 lakh through cheques as first instalment towards the flat costing Rs 32.49 lakh.

The complainant was informed that all necessary permissions and sanctions were obtained for the construction of the multi-storied building. However, till February 2013, the construction hadn’t commenced compelling the complainant to issue a legal notice.

After the firm and its directors failed to respond, Pritmani lodged a complaint with the commissioner of police (CP) on August 31, 2013, for forgery and cheating against them.

In November 2013, the firm’s agents approached the complainant and requested him not to invoke any legal action while assuring that the work would commence soon. In September 2014, a qualified architect inspected the site and certified that no construction work was started.

Citing the firm’s failure as clear case of breach of terms and conditions, Pritmani again issued a legal notice to the directors through Satuja on December 03, 2014.

Subsequently, he filed the case with the forum and submitted original documents of MOU, receipts of the part payment, legal notices issued to the firm, complaint filed with CP, and photograph of the site to show no construction had begun.

Neither anyone from the firm nor its directors replied to two notices issued by the forum, forcing it to hear the case ex-parte from February 2.

Currently, the Goods and Services Tax (GST) is levied at 12 per cent on payments made for under-construction property or ready-to-move-in flats where completion certificate has not been issued at the time of sale.